Independent C-store Market Cries Out For New Distribution Model

Convenience stores are fast becoming stores in name only. Without much notice, most have been morphing beyond traditional fuel, beer and cigarette products into new in-store categories and consumer service offerings. Eighty percent of “C-stores,” for example, now offer some form of foodservice, which is today their fastest growing source of profit. Consider also: C-stores’ in-store (non-gasoline) sales are rising at roughly 10 percent a year.

Emerging From Shadow of Grocery

• Grocery and C-store distinctions are rapidly blurring – over 30% of grocery sales are ‘quick trips’ for purchases of about $20.
• 60% of convenience stores are single-store affairs today – up from 50% in 2000 – and 70% have annual sales under $1million
• 80% of convenience stores today see some form of prepared food concept as key growth driver - $16 billion market growing over 13% annually
• C-store industry profitability up 17% in 2006 - foodservice gross margins 2x average for in-store merchandise

Packaged Goods companies, food service suppliers, broad line distributors, buying groups, food brokers, national wholesale clubs, and an assortment of other players are all jockeying for territory in the great single operator Convenience store land rush.

How can companies break from the pack and leverage new trends in C-store purchasing channels to reach this critical growth market more effectively and economically?

It is no small task. Sixty percent of convenience stores are still single-owner proprietorships. Capturing share in this fragmented, thinly financed collection of filling stations and small town mom-and-pops demands a unique go-to-market approach that integrates suppliers and their carefully managed marketing channel system.